When a General Ledger journal has a debit to a ledger account and a credit to both a vendor/customer account and a bank account, the sales tax amount is deducted from an incorrect line.
Consider the following situation. A General Ledger journal contains the following lines:
After you post and then review the voucher, the sales tax amount is be deducted from the first line. However, you expect the deduction to come from the second line, because that is where the sales tax occurred.
If you debit only one vendor/customer account and bank account line, or if you credit ledger accounts, the issue does not occur.
Consider the following situation. A General Ledger journal contains the following lines:
First line: Debit to a ledger account for $1,000 – No tax
Second line: Debit to a ledger account for $2,000 – With 5 percent tax code
Third line: Credit to a vendor account for $1,500 – No tax
Fourth line: Credit to a bank account for $1,500 – Not tax
Second line: Debit to a ledger account for $2,000 – With 5 percent tax code
Third line: Credit to a vendor account for $1,500 – No tax
Fourth line: Credit to a bank account for $1,500 – Not tax
After you post and then review the voucher, the sales tax amount is be deducted from the first line. However, you expect the deduction to come from the second line, because that is where the sales tax occurred.
If you debit only one vendor/customer account and bank account line, or if you credit ledger accounts, the issue does not occur.